The Guardian view on the banks: too big to fail cannot mean too big to tax | Editorial

<p>Financiers owe their windfalls and bonuses to higher interest rates. Britain should reclaim more for the public and resist City lobbying</p><p>John Healey is planning to tax British banks, the Guardian <a href="https://www.theguardian.com/uk-news/2026/oct/15/john-healey-raise-taxes-banks-budget">revealed</a>, in the forthcoming budget. It’s <a href="https://www.theguardian.com/commentisfree/2025/oct/26/the-guardian-view-on-the-budget-what-a-labour-chancellor-should-really-say">about time</a> for the chancellor to act. Banks have been raking it in. The campaign group <a href="https://positivemoney.org/uk/update/new-chancellor-higher-profits-its-time-to-taxthebanks/">Positive Money</a> reported&nbsp;this summer that Britain’s four biggest banks&nbsp;made £29bn in the first half of this year, up a fifth on 2025. These windfalls owe more to higher interest rates than better products or services. Households and businesses pay more to borrow. Meanwhile, the Bank of England pays the banks tens of&nbsp;billions in interest on their reserves, with the&nbsp;<a href="https://www.theguardian.com/commentisfree/2026/sep/15/the-guardian-view-on-the-bank-of-englands-120bn-bill-power-without-accountability">Treasury</a> footing the bill.</p><p>The chancellor is said to favour restoring the bank surcharge from 3% to 8%, which could raise around <a href="https://www.bbc.co.uk/news/articles/c32l4k2xdvrzo">£2bn a year</a>.&nbsp;This would recover a very modest share of the&nbsp;sector’s bonanza. Louis XIV’s finance minister, Jean-Baptiste Colbert, said that “the art of taxation consists in so plucking the goose as to obtain the largest possible amount of feathers with the smallest possible amount of hissing”. Britain’s banks have plenty of feathers. That hasn’t stopped them <a href="https://www.theguardian.com/busi